GENM-CH (resorts-ch)

In my blog, i often talk about Genting Malaysia (RESORTS), I like it very much. Last time i used to own resorts shares. After that I sold all the shares, it was not because i ceased to like it anymore. It was because I was switching part of my portfolio to warrants/call warrants.

I bought Genm-ch when was is at RM0.05, the main reason was its very high gearing of around 20 times and at the same time at very low premium of just around 5% when i bought it.

I was confident that the market was still on the uptrend, thus high gearing would provide me with GOOD LEVERAGES and better profit. Leverage is like a double side knife, it can help us and it can destroy us too. I choose high gearing call warrants only when i am very confident that the market is on a VERY STRONG uptrend especially
when the uptrend has just started. I don't want the high gearing to work against me.

As I mentioned, I trim around 30% of my portfolio in early June as I was not confident that the trend would keep on going strong. I was a bit regret that I did not close all my position on Genm-ch. I was too greedy with the fast and big profit i gained from Genm-ch and I kept hoping for more.

I managed to close some of them at RM0.135. Ya, it was the peak. After that, a short-term downtrend came for the world markets. Genm-ch did not spared from that assault, Genm-ch started to drop fast. What worry me more was the Genm-ch was near its maturity (less than 30 days). So, i sold the rest of my Genm-ch shares at RM0.06 and RM0.045.

That is the consequence of letting bad emotion (GREED) take control of us. I have no one to blame but myself. But I am still glad that I learn something from this trade.

I MUST NOT HOLD OR BUY HIGH GEARING CALL WARRANTS IF I THINK THE UPTREND IS TIRED.

I am happy I manage to gain 60% on this trade within 2 months.

I think a new uptrend has just started last week and it is supported fundamentally by good quarterly financial reports.

Ok, good luck.

GOon